LONDON (Dow Jones Newswires), Oct. 25, 2011
BP Tuesday posted a slightly better than expected 3.6% fall in adjusted net profit for the third quarter, even as a major maintenance program and a massive asset sale program caused a sharp decline in output that limited somewhat its ability to benefit from strong oil prices.
BP also announced it would increase the size and scope of an asset sale program to help cover the cost of the oil spill from $30 billion of divestments to $45 billion. BP said the additional money raised from the sales would be invested "in quality, higher-growth opportunities, mainly in exploration and production, while divesting low-returning assets." Some of the increase to the new $45 billion figure comes from the inclusion of previously announced U.S. refinery sales.
The company said its clean replacement cost profit, a keenly watched figure that strips out gains or losses from inventories and other non-operating items, fell 3.6% for the period to $5.33 billion, compared with $5.53 billion for the third quarter of 2010.
This was above expectations of $5.06 billion in a Dow Jones Newswires poll of 13 analysts.
However, production fell slightly more than expected. Total production for the period was 3,319 million barrels of oil equivalent a day, a 12% decline from last year. Analysts had anticipated 3,315 million.
The London-based energy giant said net profit for the three months ended Sept. 30 was $4.90 billion, compared with $1.79 billion for the third quarter of 2010. The sharp increase in net profit was due to BP taking another $7.66 billion pre-tax charge related to the Gulf spill in the third quarter of last year.
Total revenue for the quarter was up at $97.59 billion from $74.65 billion in the same period in 2010.
Diluted earnings per share were 25.6 cents compared with 9.4 cents the previous year.
BP shares closed Monday down 1 pence, or 0.2%, at 438p. The stock is still only two thirds of what it was before the incident, as investors continue to wait for clarity on the final spill costs and the firm's future strategic direction.
Copyright (c) 2011 Dow Jones & Company, Inc.
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